Injective could dip further as futures Open Interest drops

Key Takeaways

Injective (INJ) trades around $7.42 on Thursday, extending losses after a 5.7% decline in the previous session.

The futures taker buy-to-sell ratio stands at 0.96, with sell orders accounting for 51.1% of taker activity, suggesting that sellers retain a slight advantage.

A breakdown below the $7.19 trendline support could expose INJ to further losses toward $6.71 and $6.27, while a breakout above $8.35 could open the door to $9.41.

Injective (INJ) remains under pressure on Thursday, trading below $7.50 as declining derivatives activity and renewed selling weigh on its near-term recovery prospects.

The cryptocurrency is trading around $7.42 after losing approximately 6% during Wednesday’s session, with traders showing little conviction in a sustained rebound.

CoinGlass data reveals a steady reduction in futures Open Interest since mid-October, while market sell orders continue to outweigh aggressive buying activity.

Injective futures OI falls as traders reduce Exposure

Investor participation in Injective’s derivatives market has weakened considerably over the past several weeks.

According to CoinGlass, INJ futures Open Interest has declined by 4% in the last 24 hours and now stands at $140.77 million.

A sustained decline typically indicates that traders are reducing their positions, potentially reflecting weaker speculative interest or uncertainty about the market’s direction.

CoinGlass data shows that sellers continue to hold a slight advantage in Injective’s futures market.

The INJ taker buy-to-sell ratio stands at 0.96, indicating that aggressive sell orders are exceeding aggressive buy orders.

A ratio below 1 generally suggests that traders executing market orders are more willing to sell into existing bids than buy from available offers.

Injective technical outlook: INJ tests the crucial $7.19 trendline support

Injective’s daily chart presents a mixed technical outlook, with the cryptocurrency trading between an important moving average and a rising support trendline.

At the time of writing on Thursday, INJ trades around $7.42, slightly below its 50-day Exponential Moving Average near $7.55.

The inability to reclaim this moving average suggests that buyers have yet to regain control of the near-term trend.

However, Injective continues to trade above an ascending support trendline around $7.19. The 200-day EMA, positioned near $6.27, also remains below the current market price.

Trading above this longer-term moving average suggests that the broader technical structure has not yet deteriorated as significantly as the recent price action might imply.

Nevertheless, momentum indicators are beginning to weaken. The Moving Average Convergence Divergence (MACD) has crossed below its signal line, indicating that bullish momentum is fading.

Meanwhile, the Relative Strength Index (RSI) stands around 44, slightly below the neutral threshold of 50.

This suggests that sellers are gaining influence, although the market has not entered oversold territory.

The ascending trendline near $7.19 represents Injective’s first important downside support.

A sustained move below this level would weaken the current technical structure and suggest that sellers are gaining greater control.

If INJ breaks decisively below the trendline, the next significant support stands at $6.71. Failure to defend $6.71 would expose Injective to another important support region around $6.27.

Despite the recent weakness, Injective could attempt another recovery if buyers successfully defend the $7.19 support trendline.

The first obstacle stands at the 50-day EMA around $7.55. A sustained recovery above this level would suggest that buying momentum is improving and could encourage traders to target higher resistance.

The next major barrier stands at $8.35, a horizontal resistance level that limited Injective’s gains during the previous week.

A decisive daily close above $8.35 would strengthen the bullish outlook and potentially open the door for a recovery toward $9.41.

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